WTO Revises Global Trade Forecast Amid Geopolitical Tensions

The World Trade Organisation slightly raised its 2023 global goods trade forecast to 2.7%, despite substantial risks from geopolitical tensions and uncertain economic policies. The WTO foresees 3% growth in 2024, down from previous estimates. Inflation declines may permit interest rate cuts, aiding trade growth.

The World Trade Organisation has marginally increased its forecast for global goods trade for 2023 to 2.7%, acknowledging substantial risks from worsening geopolitical tensions and economic policy disruptions. This prediction is a slight rise from the 2.6% anticipated in April.

In a report from its Geneva headquarters, the WTO highlighted a projected growth of 3% for the following year, revised down from 3.3%. Last year witnessed a 1.1% decline in global merchandise trade, influenced by soaring inflation and climbing interest rates.

Despite these challenges, the Geneva-based organization notes a 2.3% year-on-year increase in global trade for the year's first half and mentions inflation reductions as a factor allowing some central banks to lower interest rates. However, the potential for escalating regional conflicts, particularly in the Middle East, poses threats that could affect energy costs and shipping routes.

(With inputs from agencies.)